Press Release from the Office of the U.S. Trade Representative, July 8, 2011Footnote 1
In March 2009, Mexico applied a first round of retaliatory tariffs on 89 products exported from the United States as a result of a cross-border trucking dispute between the two countries. Following a Memorandum of Understanding (MOU) on Cross-Border Motor Trucking signed by U.S. Transportation Secretary Ray LaHood and Mexican Secretary of Communication and Transportation Dionisio Arturo Pérez-Jácome Friscione this week, the Government of Mexico posted official notice that beginning today it reduced those duties by fifty percent. In response, U.S. Trade Representative Ron Kirk today issued the following statement:
“At President Obama's direction, the cross-border trucking dispute between the U.S. and Mexico has been resolved in a way that addresses safety concerns and upholds our trade obligations. With Mexico's announcement that it has cut tariffs on products exported from the U.S. by half, American manufacturers, farmers, ranchers, and companies will be able to better compete for customers in Mexico. Many of our workers build, grow and produce products that are then sold to our neighbors in Mexico, and this Administration is committed to expanding their opportunities to support well-paying jobs here at home and to continue rebuilding the U.S. economy.”
Press Release from the Office of the U.S. Trade Representative, July 14, 2011Footnote 2
The United States and Peru convened the second meeting of the Free Trade Commission (FTC) of the United States-Peru Trade Promotion Agreement (PTPA) yesterday in Lima, Peru. John Melle, Assistant U.S. Trade Representative for the Western Hemisphere, led the U.S. delegation. Carlos Posada, Vice Minister of Foreign Trade and Tourism led the delegation for Peru.
“The PTPA has strengthened ties between our governments and created new economic opportunities for our workers, businesses, farmers and ranchers. Both governments noted the good work that has been carried out jointly to achieve an effective implementation of the PTPA and to ensure that workers and businesses of all sizes have the opportunity to take advantage of the benefits created by the Agreement,” said John Melle. “The United States looks forward to continuing to work with Peru to further our bilateral trade relationship as well as advance the Trans-Pacific Partnership Agreement and other multilateral trade initiatives. We thank the Peruvian government for hosting the second Free Trade Commission meeting.”
At the FTC meeting, officials discussed bilateral trade, investment and economic issues as well as the administration of the PTPA. Both governments acknowledged the progress over the last year to implement the commitments under the Agreement, particularly the passage by Peru of the Forestry and Wildlife Law. That law sets out key reforms called for under the PTPA's Annex on Forest Sector Governance aimed at combating illegal logging and illegal trade in wildlife. The governments discussed plans to continue to work together to effectively monitor implementation of, and compliance with, environment and labor obligations. Officials also discussed commitments under the Intellectual Property Rights Chapter of the Agreement.
Additionally, officials received a report of the first meeting of the Small- and Medium-Sized Enterprise (SME) Working Group. The working group was established to enhance the ability of small businesses to capitalize on the benefits of the PTPA. The parties discussed the example of the U.S. Small Business Development Center (SBDC) model for helping small businesses to grow. The SME Working Group also released a brochure to raise awareness of opportunities for small businesses in both countries. Frequently Asked Questions About Opportunities for Small Business to Export Under the United States-Peru Trade Promotion Agreement can be viewed in English and Spanish.
Today, the Parties will hold a meeting of the Subcommittee on Forest Sector Governance to review progress on implementation of the Annex on Forest Sector Governance.
Press Release from the Office of the U.S. Trade Representative, July 15, 2011Footnote 3
This week, Assistant United States Trade Representative for Europe and the Middle East L. Daniel Mullaney and Turkish Deputy Undersecretary of the Ministry of Economy Cemalettin Damlaci co-chaired the eighth annual meeting of the U.S.-Turkey Trade and Investment Council. The Council meets under the auspices of the 1999 bilateral Trade and Investment Framework Agreement (TIFA).
“The United States greatly values its economic relationship with Turkey, which is a key strategic partner in this region of the world,” said Mullaney. “These annual meetings allow us to work together to overcome obstacles to increased trade and investment and to pursue actions to improve economic integration. We are working hard to fulfill President Obama's commitment to enhance our bilateral trade and investment ties and to seek out new ways to pursue with Turkey our mutual goals in the Middle East and North Africa.”
During the Council meeting, held on July 13 in Ankara, Turkey, the United States and Turkey pursued various mechanisms for expanding their growing trade and investment relationship, including joint support for small and medium sized exporters, regulatory and intellectual property support for innovative industries, shared priorities in third countries, and deepened ties between the U.S. and Turkish private sectors. They also agreed to a fall inaugural meeting of the U.S.-Turkey Business Council, an important mechanism for ensuring private sector input into increasing trade and investment.
The TIFA Council is also a key step in preparations for the second formal meeting, envisioned for later this year, of the U.S.-Turkey Strategic Economic and Commercial Cooperation (FSECC) dialogue. The FSECC was inaugurated in December 2009 by U.S. Trade Representative Ron Kirk and Secretary of Commerce Gary Locke with their Turkish co-chairs, Deputy Prime Minister Ali Babacan and Minister for Economy Zafer Caglayan.
Mullaney was accompanied by Deputy Assistant Secretary of Commerce for Europe and Eurasia Juan Verde and other officials from the Office of the United States Trade Representative (USTR) and the Departments of Commerce, Agriculture and State. At the meeting, senior government officials discussed a full range of trade-related issues, including intellectual property rights, steps to enhance the investment climate, biotechnology, pharmaceuticals, and government procurement.
Press Release from the Office of the U.S. Trade Representative, July 18, 2011Footnote 4
U.S. Trade Representative Ronald Kirk announced today that the United States will contribute $1.2 million for trade-related technical assistance (TRTA) to the World Trade Organization (WTO). The WTO's TRTA program provides training for developing countries that enhances their ability to analyze issues, assess their interests and participate effectively in the negotiations and other WTO activities. The program also provides these nations with assistance in meeting their WTO obligations and ensures they fully benefit from the results of being a WTO Member.
“The United States is committed to work with developing countries as partners in the global trading system. This contribution reflects our commitment to ensuring that developing countries can participate effectively in all the activities of the WTO, including the Doha Round of world trade negotiations, and to ensure that they enjoy the benefits of being WTO Members” Ambassador Kirk said. “We continue to believe that working through the WTO to create meaningful new opportunities for farmers, manufacturers and service providers will help these countries meet their development objectives and improve the well being of their people.”
The U.S. contribution, which was approved by Congress, will be part of a technical assistance fund that developing nations can use for assistance in analyzing issues, assessing individual country interests, and meeting their WTO obligations. This latest contribution will bring total U.S. trade assistance for the Doha Development Agenda to almost $11 million since the launch of negotiations in November 2001. Background
The United States’ contribution to the WTO was appropriated by Congress as part of the funds it provides to the U.S. Department State for voluntary contributions to international organizations. It is just one part of much broader U.S. assistance efforts. Overall U.S. support for trade capacity building (or “aid for trade”) since the Doha Round began in 2001, has now surpassed $11 billion.
Press Release from the Office of the U.S. Trade Representative, August 15, 2011Footnote 5
United States Trade Representative Ron Kirk announced today that the United States has prevailed in a World Trade Organization (WTO) dispute with the Philippines challenging discriminatory Philippine excise taxes on imported distilled spirits. The Philippines imposes taxes on imported distilled spirits, such as whiskey and gin, at significantly higher rates than on domestic distilled spirits.
“Today's ruling demonstrates the commitment of the United States to combat trade barriers wherever they occur,” said Kirk. “Today's Panel Report confirms that the Philippines’ taxes on imported distilled spirits are discriminatory and inconsistent with WTO rules. We urge the Philippine government to comply swiftly with the Panel's recommendations and rulings, and level the playing field for our exports immediately.”
BACKGROUND
The Philippines’ tax rates on distilled spirits differ depending on the product from which the spirit is distilled. Its tax rates on distilled spirits made from materials that are typically produced in the Philippines, such as sugar and palm, are generally low (currently 14.68 pesos per proof liter). However, imported distilled spirits are taxed at rates from approximately ten to forty times higher than those applied to domestic products. In the Philippines, producers use domestic materials, such as sugar, to create a variety of different distilled spirits, including whiskey, brandy, gin, vodka, and tequila. These distilled spirits compete with U.S. imports of the same spirits made from other materials (such as whiskey distilled from wheat).
The WTO generally bars its members from discriminating between imported and domestic products in their tax regimes. The United States brought two legal claims against the Philippines’ measures, and prevailed on both. Specifically, the Panel found that the Philippines applies higher taxes to imported distilled spirits than to “like product” or “directly competitive or substitutable” domestic distilled spirits, in violation of the first and second sentences of Article III:2 of GATT 1994.
The U.S. Government raised concerns over this issue with the Philippines the past, both bilaterally and in WTO forums. The U.S. sought WTO consultations on the matter in January 2010, and a WTO Panel was composed in July 2010. The same Panel heard claims by the European Union on the same measures, and findings in that dispute were also issued today.
Between 2006 and 2010, U.S. distilled spirits exports worldwide averaged more than $1 billion per year, making the United States one of the world's largest exporters of spirits. According to industry figures, the U.S. distilled spirits industry contributed to more than $113 billion dollars of economic activity and over 1.2 million jobs in 2007.
Press Release from the Office of the U.S. Trade Representative, August 19, 2011Footnote 6
U.S. and Liberian officials met this week in Washington to review progress in deepening their partnership on trade and investment under the United States-Liberia Trade and Investment Framework Agreement (TIFA). This was the third meeting of the United States-Liberia TIFA Council, which provides a high-level forum for advancing cooperation on bilateral trade and investment issues.
Deputy U.S. Trade Representative Demetrios Marantis and Liberian Minister of Commerce & Industry, Miata Beysolow, co-chaired the day-long meeting on Wednesday, August 17, which examined the two governments’ work together on a number of trade-related issues, including: implementation of the African Growth and Opportunity Act (AGOA), trade capacity building, export diversification, trade and investment promotion, infrastructure issues, and Liberia's accession into the World Trade Organization (WTO). Minister Beysolow was accompanied by a high level delegation of Liberian Government officials, including Minister of Agriculture, Florence Chenoweth; Minister of Post and Telecommunications, Frederick Norkeh; Minister of Transport, Willard Russell; Chairman of the National Investment Commission, Natty B. Davis; Deputy Minister of Finance for Revenue, Elfrieda Tamba; Deputy Minister for Economic Affairs and Policy, Sebastian Muah; and Assistant Minister of Commerce and Industry, Aletha Brown.
“Since the TIFA was signed in 2007, the United States and Liberia have made huge strides in strengthening our engagement on bilateral trade and investment,” said Ambassador Marantis, “and we have seen increased trade in both directions as a result. Liberia offers enormous potential and opportunity for trade and investment. We plan to use the U.S.-Liberia TIFA Council to develop specific initiatives to expand economic opportunities for workers, farmers, businesses, and consumers in both countries.”
Following government-to-government consultations under the TIFA, meetings were held with the U.S. business community at the U.S. Chamber of Commerce and the Corporate Council on Africa. During these meetings Liberian officials outlined the many policy, legal, and regulatory steps that have been taken to encourage investment in Liberia and U.S. businesses had the opportunity to discuss their interests and questions about doing business in Liberia.
In 2010, the U.S. and Liberia's total two-way goods trade was $370 million. U.S. goods exports to Liberia totaled $190 million in 2010, up 102 percent from the previous year. Top U.S. exports were medical instruments, vehicles, cereals, and iron and steel products. U.S. goods imports from Liberia totaled $180 million in 2010, up 124 percent from the previous year. Top imports from Liberia last year were rubber, oil, and precious stones (diamonds).
BACKGROUND
The U.S.-Liberia Trade and Investment Framework Agreement (TIFA), signed in February 2007, established a formal, highlevel dialogue to address bilateral trade and investment issues and to enhance economic engagement between the United States and Liberia. The previous TIFA Council meeting was held in Monrovia, Liberia in March 2009.
Press Release from the Office of the U.S. Trade Representative, August 26, 2011Footnote 7
Deputy United States Trade Representative Ambassador Miriam Sapiro and Israel's Director General of the Ministry of Industry, Trade, and Labor, Sharon Kedmi, this week reached agreement on a process to further their shared commitment to expand trade and investment between the United States and Israel. They applauded progress on trade and investment issues since a meeting between Ambassador Kirk and Minister Ben Eliezer in Washington in October 2010, and agreed to a plan that will guide future discussions and develop further as those discussions evolve. They also agreed to redouble their efforts to make further progress ahead of the U.S.-Israel Free Trade Agreement (FTA) Joint Committee meeting, to be held later this fall.
“The Obama Administration places great importance on the relationship between our countries, and we will continue our collaborative efforts to expand trade and investment opportunities for American and Israeli exporters and investors,” said Ambassador Sapiro.
The two sides also agreed to explore ways to realize fully the potential benefits of the U.S.-Israel trade agreement, including through the further liberalization of trade in services and agriculture and the removal of trade-restrictive measures. Ambassador Sapiro and Director General Kedmi also committed to consider cooperation in other areas, including addressing regulatory issues which might be impeding the movement of goods, services and capital between the two countries, in consultation with relevant stakeholders.
Press Release from the Office of the U.S. Trade Representative, September 5, 2011Footnote 8
Today United States Trade Representative Ron Kirk announced that the World Trade Organization (WTO) Appellate Body found in favor of the United States in a dispute brought by China challenging the imposition of additional duties on imports of Chinese tires. A WTO panel had rejected all of China's claims against the United States, finding that the United States acted consistently with its WTO obligations in imposing the additional duties. The Appellate Body, in turn, rejected all of China's claims on appeal.
“This is a tremendous victory for the United States as well as for American workers and manufacturers. We have said all along that President Obama's decision to impose duties on Chinese tires was fully consistent with our WTO obligations. A WTO panel agreed with us and now the Appellate Body has confirmed it,” said Ambassador Kirk. “The Obama Administration will continue to fight for U.S. jobs and businesses. We will use our trade laws to stand up for our workers and address harm to them.”
Press Release from the Office of the U.S. Trade Representative, September 5, 2011Footnote 9
“We are pleased to bring trading partners to Chicago this week from eight economies in the Asia-Pacific region. The Administration's goal is to craft a highstandard, 21st-century agreement that tackles the tough issues of trade in creative and thoughtful ways, with considerable input from the broadest range of stakeholders, in order to boost trade and investment and support the creation and retention of jobs,” said Assistant U.S. Trade Representative Carol Guthrie. “During the Chicago round, the U.S. Government will be hosting a forum at which nearly 250 stakeholders representing business, academic groups and the public will be given an opportunity to make presentations on issues related to the TPP negotiations. Last year we invited stakeholders to engage at the June TPP negotiating round in San Francisco. We have invited stakeholder attendance during every subsequent round. Thanks to this and other outreach, we already have had considerable input from the broadest range of stakeholders as we have been developing our proposals for the negotiations. We very much look forward to receiving further input from these stakeholders and expect that, as always, their contributions will inform the discussions of negotiators in this U.S.-hosted round of talks.”
Remarks by U.S. Trade Representative Ambassador Kirk, September 9, 2011Footnote 10
Ambassador Ron Kirk delivered these remarks in Chicago, IL
Ambassador Kirk. [T]hank you for hosting the delegations of the nine Trans-Pacific Partnership members this week.
We are grateful for the opportunity to meet in your fair city and state, to make progress toward a trade agreement that will enhance trade across the rapidly-growing Asia-Pacific region and support job growth.
I also want to thank Cal Cohen and the TPP Coalition this evening.
We are fortunate to have many distinguished participants, including my fellow ambassadors from TPP member countries, TPP delegates, and stakeholders from America and other Asia-Pacific countries.
It is fitting that we should meet here in Chicago. This city has thrived on international trade for more than one hundred years.
Chicago is home to a wide range of industries from aerospace and automobile manufacturing to health care and hightech.
And in 2009, the greater Chicago area exported $28.2 billion dollars’ worth of goods, which makes it the 7th largest exporting metropolitan area in the United States.
Last year, the state of Illinois exported $50.1 billion of goods alone—not even counting your services sales. And Illinois exports support a lot of jobs—more than 380,000 at last count.
Businesses, workers, farmers, ranchers, manufacturers and service providers here all stand to gain significantly from the export opportunities that an ambitious, 21st century regional Trans-Pacific Partnership will offer.
As you may know, last night, President Obama presented to Congress a series of practical proposals to jumpstart U.S. job creation. These proposals have traditionally had bipartisan support.
The President challenged Congress to put country before party and pass these measures without delay so we can send more Americans back to work as soon as possible.
The President has consistently supported a balanced trade agenda to create jobs and help American workers support their families.
He has been clear that he intends to advance the job-creating free trade agreements with South Korea, Colombia, and Panama, and renew Trade Adjustment Assistance.
And as we do that work, the President has directed us to advance boldly in other areas, including the rapidly-growing Asia-Pacific region.
I'm here to emphasize the importance of continued cooperation among TPP member countries and stakeholders. We must keep working diligently toward an ambitious 21st century regional trade agreement.
As we begin the eighth round of negotiations, it's clear that TPP member countries share a commitment to sustain the steady progress and positive momentum we have built thus far.
At the same time, as we consider serious proposals in several critical areas, we know that continued engagement among TPP members and stakeholders will be critical to achieving the ambitious goals we share.
So in addition to the negotiators, I'd like to thank the many stakeholders who continue to make valuable contributions to these talks.
The stakes for our success are high. We must secure the jobs that trade supports. We must also strengthen regional relationships that could pave the way toward an eventual Free Trade Area of the Asia-Pacific.
History has shown that close ties among trading partners can foster favorable conditions for peace and prosperity.
These benefits will be paramount in many of our minds this Sunday, when people across the United States and around the world will remember those devastated by the terrorism of September 11, 2001.
We can never fill the void created on that horrible day. But we may honor the victims with our mutual and affirmative support for peace, security, prosperity, and universal rights around the globe.
There is much to do to ensure a stable and prosperous future for our planet.
Millions of businesses, workers, and families in every TPP partner country are counting on us to cooperate so that we can realize the full potential of a robust, thoughtful, market-opening agreement.
I offer my wishes for a productive week to all negotiators.
Our goal is still to achieve the broad outlines of this groundbreaking agreement by November, so that we can ultimately conclude the strongest agreement possible in a timely fashion.
This week, I encourage everyone to aim high and think big. Together, we can deliver the job-building opportunities of 21st century trade to businesses, workers, and families across the Asia-Pacific.
Thank you.”
Press Release from the Office of the U.S. Trade Representative, September 12, 2011Footnote 11
Today at Round 8 of the Trans-Pacific Partnership negotiations in Chicago, IL, the Office of the U.S. Trade Representative issued a white paper outlining a new USTR strategic initiative entitled “Trade Enhancing Access to Medicines (TEAM).” TEAM is designed to deploy the tools of trade policy to promote trade and reduce obstacles to access to both innovative and generic medicines, while supporting the innovation that is vital to developing new medicines and achieving other medical breakthroughs.
The white paper describes how, under the TEAM approach, the United States proposes to work with partners Australia, Brunei Darussalam, Chile, Malaysia, New Zealand, Peru, Singapore, and Vietnam to achieve the following goals in a TPP agreement:
Expedite access to innovative and generic medicines through a “TPP access window”
Enhance legal certainty for manufacturers of generic medicines Eliminate tariffs on medicines Reduce customs obstacles to medicines Curb trade in counterfeit medicines Reduce internal barriers to distribution of medicines
Promote transparency and procedural fairness
Minimize unnecessary regulatory barriers Reaffirm TPP Parties’ commitment to the Doha Declaration on TRIPS and Public Health
“The truth is, trade policy by itself can't address all the challenges of access to medicines, but we believe trade policy can be a meaningful component of the Obama Administration's broad effort to promote that access,” said U.S. Trade Representative Ron Kirk. “These Trans-Pacific Partnership proposals will help to drive access to innovative and generic medicines, through tariff cuts, intellectual property provisions, and a host of other measures that will help to boost the availability of life-saving innovative and generic medicines to people throughout the Asia-Pacific region.”
Trans-Pacific Partnership negotiations are expected to continue in Chicago through September 15.
Remarks by Deputy U.S. Trade Representative Ambassador Sapiro, September 15, 2011Footnote 12
Deputy Representative Miriam Sapiro delivered these remarks in Washington, DC
Deputy Ambassador Sapiro. Let me start by thanking the U.S.-Middle East Free Trade Coalition, the National Foreign Trade Council and WITA for providing this opportunity to discuss an important aspect of the Obama Administration's approach to the dramatic changes we have witnessed this year in the Middle East and North Africa (MENA). Today, I would like to focus on the general framework for greater trade and investment in the region we are working to establish.
This audience knows well the critical importance of trade to creating economic growth and jobs. Global trade this year is estimated to total over $20 trillion, or about 30 percent of world GDP. In the United States, every $1 billion in goods and services exports supports an estimated 5,500 jobs. There is no good reason why the MENA region too should not enjoy the benefits of global trade.
Given the link between trade and jobs, trade liberalization in today's globalized economy is more important than ever. Eliminating barriers—tariff and non-tariff—has helped countries around the world generate growth and reduce poverty. According to the World Bank, developing countries that lowered barriers the most saw per capita real income increase nearly three times faster in the 1990s than those who liberalized to a lesser degree.
We also know that enhancing economic security is one of the best ways to promote political and economic reforms and diminish the appeal of violent extremism. Ever since the Arab Spring began, the Administration has been working to define how we can best support the aspirations of the citizens of the region for expanded opportunities. We are particularly focused on ways to create broad-based economic growth that can help support democratic reforms by providing a strong foundation for inclusive development and prosperity.
For all of these reasons, international trade and investment will play a key role in U.S. engagement with the MENA region. To fulfill this vision, last May President Obama announced a new trade and investment partnership initiative to help advance economic development for nations transitioning to democracy. The key objectives of this partnership are:
First, to facilitate trade within the region;
Second, to promote trade and investment integration with the United States and other global markets; and
Third, to open the door to willing and able MENA partners—in particular those adopting high standards of reform and trade liberalization—to construct a regional trade arrangement.
Although our initiative encompasses the entire region, the Administration identified Egypt and Tunisia—where the Arab Spring began in earnest—as two countries in which the stakes are high, and where measurable progress can bolster democratic change and economic reforms elsewhere. Libya too will be important as the situation there stabilizes.
To implement the President's initiative, key agencies across the government have come together with the common goal of deepening our trade and investment ties to the region. I am delighted to be joined this morning by colleagues from the Overseas Private Investment Corporation and the Trade Development Agency, who will highlight a few of the programs their agencies are launching. Together we are working to develop ambitious ideas, some of which will depend on the availability of funding and technical assistance.
Let me start with a few of the challenges and opportunities we see in the region, and then describe what we are doing in response.
With a growing population of over 400 million people and an expanding regional GDP of over $2.4 trillion, the Middle East and North Africa represents an enormous opportunity for mutually beneficial growth in trade and investment. It is currently the fifth largest destination for U.S. exports, and offers significant possibilities for U.S. investors.
Yet, on the whole, trade and investment with, and within, the region has underperformed. If you exclude oil, the entire MENA region exports roughly the same amount as Switzerland. It is also one of the least integrated regions in the world. In 2009, for example, intra-regional merchandise exports amounted to only 9.5 percent of the region's total exports. This is the same level of trade as ten years ago. There is no lack of analysis of why this is the case, but there is also no good reason why this situation cannot change.
Let me highlight a few of the most salient issues we would like to address:
We know that the greatest untapped resource in the Middle East and North Africa is the talent of its people. But talent requires a supportive environment before it can thrive. As the President has said, “many young people have a solid education, but closed economies [have left] them unable to find a job. Entrepreneurs are brimming with ideas, but corruption [has left] them unable to profit from those ideas.”
Expanded employment in the region, especially among youth, is clearly critical to future growth and prosperity. The lack of employment prospects for the young has been one of the most visible catalysts for protests and demands for reform. At the same time, the underutilization in the workplace of the female population is striking. Women are a chronically under-tapped resource for business; in some countries, women represent 63 percent of university students, but only 28 percent of the workforce. Countries will have difficulty achieving economic growth if they fail to fully empower half of their potential workforce.
In addition, the institutional infrastructure in parts of the region is often insufficient for promoting broad-based growth. For instance, bank lending to small- and medium-sized enterprises (SMEs) is the lowest in the world, with only ten percent of SMEs financing their investments with bank loans. Indeed, as a general matter, opportunities for SMEs and new market entrants—often powerful engines for broad-based growth for the disenfranchised—have been lacking, as institutions have tended to favor the privileged few. This has hobbled the many entrepreneurs who could thrive on a more level playing field.
A snapshot comparison with other economies is revealing. The average age of a firm in still-growing Central Asia is just over 10 years; within MENA, it is nearly double, at 19 years. In fast-growing East Asia, managers have an average of seven years on the job; within MENA, the number is twice that. The lack of opportunity for newer, dynamic entrants to the MENA market has created stasis, rather than economic growth.
Yet there are good reasons for hope, and these can help shape our response in the region. Notably, across the Arab world, citizens are mobilizing, often at local levels, to demand better services and greater accountability from their public institutions. They are seeking increased transparency across the board from public authorities, and greater participation in how rules are set. This extends to the economic sphere, where frustration with secretive business dealings among elites was a prime motivation for many who took to the streets.
To help the MENA region address these challenges, the Administration has outlined a new economic vision for countries committed to democratic and economic reform.
This vision builds upon our already significant trade and investment ties to the region. We have trade agreements with Bahrain, Israel, Jordan, Morocco and Oman. And we have in place trade and investment framework agreements with eleven other MENA countries, as well as bilateral investment treaties with several more. Our intent is to build on these relationships, and create new ones wherever possible.
From the outset, let me stress that our initiative is not about seeking to impose any particular model on any country. Rather, our goal is to discuss with each government different options for effectively stimulating the economic growth their populations are demanding.
We further realize that some in the region are skeptical of economic reform programs, and of foreign companies in general, because of memories of certain elites who abused their access in the past. Yet it is clear that promoting a higher level of integration within the region, and with the international community, is one of the surest paths to economic growth, diversification and job creation.
Our first task thus has been to listen: to talk to the broadest possible range of private and public sector stakeholders, both in the United States and in the region, to consider the most appropriate means of using trade and investment to boost overall growth and job prospects. We have engaged already with stakeholders, both here and in the region, including representatives from transitional governments, to understand better their priorities.
To this end, just over a week ago, we published a notice in the Federal Register soliciting public comments on the priorities for fleshing out the President's trade and investment initiative. The deadline for comment is one month from today—October 15th—please provide us with the benefits of your insights. We will incorporate these views as we further develop, elaborate and pursue our initiative. We are fully aware that the initiatives we pursue and the timetable for pursuing them will depend on continued close consultations with a broad range of stakeholders and, most significantly, with the newly forming governments in the region.
So, what have we learned from our discussions about priorities thus far? And where are they likely to lead us in the future? Let me offer two general observations.
First, on a fundamental level, there are a few bedrock principles that are indispensable to any set of specific initiatives if they are to satisfy the political and economic aspirations that created the Arab Spring. Notably, any meaningful trade and investment initiative has to promote the objectives of transparency, public participation, and anti-corruption. In the trade and investment realm, one might express this broadly as the need for an economic ‘rule of law.’ The revolutions were to a large degree fueled by the failure of previous regimes to respect these principles, and to widely share the benefits of economic growth, trade and investment. Any initiative that is not fundamentally compatible with basic tenets of democracy, rule of law, and public integrity will not succeed.
Second, there are a number of areas that would likely promote these objectives and appear—subject to further consultation and refinement—to present strong opportunities for increasing trade, investment and job growth. Of these, there are clearly some on which we could begin work now and that could deliver results relatively quickly, and others that will require more time. However, we see no reason why longer term goals should delay shorter term objectives. Therefore, we intend to prioritize various areas in order of their ability to be implemented and produce results. In this way we can use each of these areas, step-by-step, as building blocks to increasingly greater trade liberalization.
With this approach in mind, in our discussions to date we have focused on several specific areas that appear particularly promising:
The first is in the area of trade facilitation—the goal of making it easier for goods to cross borders—where we see significant possibilities for early productive collaboration, not only bilaterally with our MENA counterparts, but also with other governments and international institutions. Improvements and cooperation in customs procedures and establishing fair, predictable, and transparent rules are essential. Trade facilitation also involves a broader range of initiatives to speed the movement of goods across borders. In addition to negotiations on trade facilitation taking place in the World Trade Organization, the United States, the EU and some of the multilateral development banks (MDBs) have pursued initial programs in recent years aimed at improving the capacity of local authorities to process goods more efficiently and securely.
A second idea we are exploring is promoting greater SME involvement in trade-and investment-related activities. Time and again, the SME sector, which I mentioned earlier, has proven to be the key source of dynamism in a modern economy. Support of various forms for SMEs, pursued in conjunction with broader SME development activities undertaken by other strategic partners and MDBs, can help meet the demands of people in transition countries for a more direct stake in their economies. Indeed, OPIC, which is providing up to $2 billion in financial support to catalyze private sector investment in the region, is prioritizing the SME sector.
Moreover, in addition to being a promising avenue for building economic inclusiveness and job creation, SMEs often benefit groups that have been historically marginalized, such as women entrepreneurs. Helping SMEs can help these groups.
Third, there is great potential for progress in the services and investment areas. All MENA economies would benefit from increased investment. Transition governments that implement policy changes creating a welcoming environment for investment—especially the transparency, predictability and rule of law I noted earlier—will be the first to see foreign investment flow, spurring welcome innovation along with new jobs. And, of course, one of the hallmarks of a 21st century economy is the growth and diversification of the services sector. Here TDA is laying the groundwork for increased collaboration with U.S. businesses in countries such as Egypt by providing grant funding in the form of pilot projects, feasibility studies and technical assistance.
The advantages of creating a favorable investment and services environment are of course not limited to foreign direct investment. Purely domestic firms, including SMEs, will benefit tremendously from predicable and transparent rules that encourage new investment.
Fourth, improving access to and utilization of preference programs, such as the Generalized System of Preferences (GSP), could bring improvements in trade flows for qualifying products and countries.
Of course, there is much work beyond these areas that will be important to future MENA prosperity, some of which by its nature will be a longer term undertaking. For example, we are examining additional measures to stimulate trade and investment in the agricultural sector that could yield significant dividends in terms of economic growth and jobs. In addition, businesses of all sizes—in both developed and emerging economies—increasingly view adequate protection of intellectual property rights (IPR) as an essential element of sustaining global competitiveness and fostering innovation.
Similarly, work to further develop good regulatory practices and enhance the ability of exporting and importing companies to meet regulatory requirements could go a long way toward enhancing trade and investment. Companies routinely note to us that confusing or onerous government regulations represent one of their greatest challenges in the MENA region. While this goal may take longer to achieve than others, a targeted approach can yield important benefits later.
I want to highlight one other aspect of our initiative, which is working wherever possible with other trading partners, such as the European Union. The United States and the EU already share many goals for the MENA region, including a strong interest in increasing intra-regional trade and integration and a climate that supports investment and job creation. Where possible, we are seeking to maximize our collective resources to help trade and investment grow.
As I mentioned earlier, we recognize that the stakes are high and the needs significant for Egypt and Tunisia. For this reason, we have focused our initial efforts on these two countries. However the President also articulated a vision of opening the door to those willing and able partners—in particular those adopting high standards of reform and trade liberalization—to construct a regional trade arrangement.
While we are focusing initially on key trading partners in transition, we are also structuring our cooperation in a way that facilitates greater economic integration within the region and creates opportunities for other regional partners to join us. We envision sitting down with our regional counterparts and starting a dialogue that will enable us, as a group, to identify the most promising avenues for increasing trade and investment with, and within, the region. This dialogue would be an important step towards constructing a broader trade arrangement that fuels growth, development and greater economic security.
We have done considerable work to create a trade and investment initiative that is both meaningful and flexible enough to adapt to contingencies and changing dynamics on the ground. Ambassador Kirk and I will continue to develop it in collaboration with our regional partners and our stakeholders, including all of you, who share our commitment to helping build a more democratic and prosperous MENA region. Thank you very much.
Press Release from the Office of the U.S. Trade Representative, September 16, 2011Footnote 13
Today, United States Trade Representative Ron Kirk hosted the sixth meeting of the United States—Central Asia Trade and Investment Framework Agreement (TIFA) Council in Washington, D.C. Attendees included delegations from Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan, and Afghanistan, as well as officials from numerous other U.S. Government agencies, including the Departments of Commerce, State, Agriculture, and Defense.
In a statement at the meeting, Ambassador Kirk congratulated these partner countries for their 20 years of independence. “I am proud of the strong and steadily improving relationship the United States has with the nations of Central Asia,” he said. “We were one of the first countries to recognize the newly independent countries of Central Asia in 1991. And now, 20 years later, we are more committed than ever to working with this region to ensure that our shared commitment to lowering barriers to trade and investment is realized. It is my hope that we can continue to work toward a more integrated Central Asian region and remove barriers to trade between the U.S. and Central Asia.”
Through a TIFA Council decision, Ambassador Kirk and the five Central Asian ministers and ambassadors formally established bilateral working groups under the TIFA. On September 14, members of the Afghanistan delegation held bilateral working group sessions with the United States, even though Afghanistan is an observer to the TIFA. The United States also hosted bilateral working group sessions with Uzbekistan, Tajikistan, Kazakhstan and Kyrgyzstan on September 14 and 15 leading up to the TIFA Council meeting. On September 15, the Central Asian and Afghanistan delegations met with private sector representatives to discuss ways to promote trade and investment in each country. The countries hope to include a private sector meeting on the margins of each TIFA Council meeting.
The meeting focused on the importance of reducing or eliminating barriers to trade and investment in Central Asia and facilitating cross-border transactions. Kazakhstan provided an overview of the newly formed Kazakhstan-Belarus-Russia Customs Union. Other attendees provided updates on efforts to accede to the World Trade Organization (WTO), with the exception of Kyrgyzstan, who has been a WTO Member since 1998. USTR staff provided an overview of the Special 301 Intellectual Property Report process and led a discussion on how the Central Asian countries can address concerns with intellectual property protections. Afghanistan provided its perspectives on the Afghanistan-Pakistan Transit Trade Agreement (APTTA) and the implications for trade and investment in the region, as well as its negotiations for WTO Accession. Each country provided its views on the proposed New Silk Road initiative for all of Central Asia. The Departments of Defense and State gave a joint presentation on the New Silk Road initiative.
At the conclusion of the meeting, the Parties agreed that it provided an important forum to exchange views on trade and investment issues and look forward to the next TIFA Council meeting in 2012. Ambassador Demetrios Marantis, Deputy United States Trade Representative endorsed the proposal by Minister Aitzhanova of Kazakhstan to have discussions within the TIFA on trade and gender issues and encouraged the Central Asian countries to choose the next location for the TIFA Council meeting somewhere in Central Asia.
Press Release from the Office of the U.S. Trade Representative, September 19 2011Footnote 14
Today United States Trade Representative Ron Kirk held a wide-ranging discussion today with Indonesian Minister of Trade Mari Pangestu under the U.S.-Indonesia Trade and Investment Framework Agreement (TIFA). The two ministers discussed bilateral, regional and multilateral trade issues, including the importance of expanding cooperation on APEC issues prior to the Leaders’ Summit in November. With respect to the bilateral relationship, they welcomed the rapid increase in bilateral goods trade last year to an alltime high of $23 billion. U.S.-Indonesia trade supports U.S. jobs in sectors such as aircraft, agriculture, machinery and electrical machinery, and professional services.
“Trade with Indonesia supports American jobs in sectors across the U.S. economy, and this relationship has tremendous potential,” said Ambassador Kirk. “We share a strong interest in working together with Southeast Asia's largest economy, resolving outstanding issues and developing new initiatives that will build our trade and investment relationship to the benefit of people in both our countries.”
The ministers agreed to explore new initiatives to build further momentum in the relationship, and expressed interest in holding a high-level business dialogue during the next year.
Prior to the meeting between Ambassador Kirk and Minister Pangestu, the two sides held technical discussions of bilateral trade and investment issues, including issues related to pharmaceuticals trade, food and beverage labeling restrictions, the Generalized System of Preferences, and agricultural trade. The ministers charged their staffs with making additional progress in resolving these issues prior to the President Obama's planned visit to Indonesia in November.
Press Release from the Office of the U.S. Trade Representative, September 20, 2011Footnote 15
United States Trade Representative Ron Kirk announced today that the U.S. has filed a case against China before the World Trade Organization (WTO) to protect jobs in America's poultry processing sector, which directly employs 300,000 workers, as jobs in this sector are threatened by China's imposition of duties on imports of American chicken products. This is the latest in a series of enforcement steps the United States has taken to hold China accountable for its WTO commitments, including actions at the WTO against China's treatment of steel products, industrial raw materials, electronic payment services and wind power equipment as well as actions in the United States to address rapidly increasing Chinese tire imports. In each of these matters, the key principle at stake is that China must play by the rules to which it agreed when it joined the WTO, including commitments to maintain open markets on a non-discriminatory basis, and to follow procedures in a transparent way.
“To be clear, the United States does not arbitrarily seek disagreements with China,” said Ambassador Kirk in a news conference today. “However, we will not stand still if we believe that China has violated its commitments as a WTO member and is therefore threatening American jobs—in this case hundreds of thousands of American poultry industry jobs. Our actions against China simply demonstrate that the United States is prepared to take every measure necessary to stand up for American workers by ensuring that China—or any of our other trading partners—does not misuse laws to prevent exports of U.S. products.”
Specifically, the United States is requesting dispute settlement consultations—the first step in a WTO dispute—to challenge China's imposition of antidumping and countervailing duties against imports of U.S. chicken “broiler products,” which are both chicken products that are not cut into pieces, as well as various cuts and pieces. Through this case, the United States is addressing its concerns that China's duties appear to be inconsistent with WTO rules. Under WTO rules, parties that do not resolve a matter through consultations within 60 days may request the establishment of a WTO dispute settlement panel.
Before the imposition of these duties, the United States was China's largest chicken broiler products supplier with over 600,000 metric tons of broiler products exported in 2009. Since the duties have come into force, U.S. exports to China are down 90 percent. According to industry sources, if these duties are not lifted, the U.S. poultry industry will have lost approximately $1 billion in sales to China by the end of this year alone.
Remarks by U.S. Trade Representative Ambassador Kirk, September 20, 2011Footnote 16
Ambassador Ron Kirk delivered these remarks in Washington, DC
Ambassador Kirk. I'm here to announce that the Obama Administration is once again taking action to hold China accountable for commitments that it made when it joined the World Trade Organization ten years ago.
Today's action pertains to what we believe is China's wrongful imposition of trade remedies against U.S. chicken products. It's a case that has implications for an estimated 300,000 American farmers and workers throughout the U.S. poultry supply chain.
Specifically, today the United States is requesting consultations in the World Trade Organization (WTO) to challenge antidumping and countervailing duties against U.S. chicken products that we will show are inconsistent with WTO rules.
USTR General Counsel Tim Reif will provide you with legal details about the case in a moment, so let me offer a few general thoughts about why we are taking this action.
From day one of the Obama Administration, we've been clear that when it comes to enforcement and China, we have one simple request of our Chinese partners: ‘live up to the promises you made when you joined the WTO.’
Since President Obama took office, this Administration has taken action to hold China accountable on tires, steel, industrial raw materials, electronic payment services, wind power, chickens, and the list goes on and on.
In every one of these cases, the key principle at stake has been that China must play by the rules to which it agreed when it joined the WTO, including commitments to maintain open markets on a non-discriminatory basis, and to follow rules-based procedures in a transparent way.
Let me be clear: the United States does not arbitrarily seek disagreements with China. Nor is it our desire to be disagreeable.
In fact, we always prefer to settle disputes with negotiation rather than litigation. We're interested in getting results that work as quickly as possible.
But we won't negotiate indefinitely, because U.S. farmers, ranchers, small business owners, and workers can't afford to wait when their exports are being blocked and American jobs are at stake.
That's why President Obama and I have been very clear that we will not hesitate to fight for every American job, every dollar worth of U.S. exports, and every chance for American producers to compete that depends on having a level playing field in China.
Ten years ago, the United States supported China's effort to join the WTO based on China's promises to behave responsibly, because we recognized the tremendous benefits of trade between both consumers and producers in two of the world's largest economies.
Today, we continue to believe that two-way trade with China works for the American people when we insist that China lives up to its commitments, plays by the rules to which it has agreed, and maintains a level playing field for American producers to compete.
As with every enforcement action, our goal here is to get real results for American exporters and support American jobs that depend on trade, including as many as 300,000 poultry industry jobs potentially affected in this case.
Now I'd like to turn it over to Tim Reif, who will provide you with additional details. Thank you.
Press Release from the Office of the U.S. Trade Representative, September 21, 2011Footnote 17
United States Trade Representative Ron Kirk met today with Philippine Secretary of Trade and Industry Gregory Domingo to discuss bilateral, regional, and multilateral trade issues and to open a Trade and Investment Framework Agreement (TIFA) meeting, which will last through Friday. The Philippines is a key market in Southeast Asia for U.S. exporters of goods, services, and agricultural products. Two-way goods trade between the United States and Philippines totaled $15 billion in 2010. U.S. agricultural exports totaled $1.6 billion, making the Philippines the 11th largest agricultural export market of the United States. Services added another $4 billion to the bilateral trade relationship in 2009.
“The Philippines is an important friend, ally, and trading partner of the United States,” said Ambassador Kirk. “Trade with the Philippines already supports thousands of jobs in both countries, and we have a strong shared commitment to working together to address outstanding issues and explore new trade and investment opportunities that can create even more jobs for our people.”
The meeting between Ambassador Kirk and Secretary Domingo opened a three-day program of discussions under the U.S.-Philippine TIFA, which will cover all aspects of the trade relationship. In addition to key outstanding bilateral issues, including agriculture, intellectual property, customs, and trade and labor, Ambassador Kirk emphasized the importance of expanding cooperation on APEC issues prior to the Leaders’ Summit in November.
Ambassador Kirk also briefed Secretary Domingo on progress being made in the Trans-Pacific Partnership (TPP) negotiations, an ambitious regional agreement that the United States and eight other Asia-Pacific countries are negotiating, which the Philippines has expressed interest in potentially joining. The two countries also discussed the Partnership for Growth, an initiative aimed at supporting economic reform in the Philippines, including in areas that would help better position the Philippines to join the TPP in the future.
Press Release from the Office of the U.S. Trade Representative, September 22, 2011Footnote 18
U.S. Trade Representative Ron Kirk today hosted trade talks with a delegation from the Common Market for Eastern and Southern Africa (COMESA)—the largest regional economic organization in Africa and a key United States trading partner. The talks were held under the U.S.-COMESA Trade and Investment Framework Agreement (TIFA), which provides a high-level forum for advancing a cooperative partnership on bilateral trade and investment issues. During his opening remarks, Ambassador Kirk commended COMESA's work in advancing economic integration in sub-Saharan Africa.
“We know that regional economic integration is a powerful engine for growth and development, which is why the United States has long supported COMESA and other regional economic communities in Africa,” said Ambassador Kirk. “I am proud of the strong relationship the Unites States has with COMESA, and our Trade and Investment Framework Agreement is key pillar of that relationship. Under the TIFA, we have established a long-standing, cooperative partnership that I expect will only continue to progress and grow stronger.”
Total two-way goods trade between the United States and COMESA countries was $15.1 billion in 2010, with U.S exports totaling $9.3 billion—a 20 percent jump from the previous year. U.S imports from those countries totaled $5.8 billion in 2010, which is 6 percent above what it was in 2009. Egypt was by far the United States’ top COMESA trading partner last year, with two-way trade between the countries totaling $9 billion. Top U.S. exports to COMESA countries in 2010 were aircraft, cereals, machinery, and vehicles. Top imports that year included oil, apparel, and chemicals.
The day-long TIFA Council meeting today examined the two governments’ joint work on a number of trade-related issues, including implementation of the African Growth and Opportunity Act (AGOA), agricultural trade and cooperation, export diversification, intellectual property rights, infrastructure issues, and COMESA's progress towards regional integration. Secretary General Sindiso Ngwenya led the COMESA delegation and co-chaired the meeting. In addition to high-level officials from the COMESA Secretariat and member States, U.S. officials from a range of agencies, including the Departments of Agriculture, Commerce, Energy, and Transportation, the U.S. Agency for International Development (USAID), the U.S. Trade and Development Agency, the Millennium Challenge Corporation and the Overseas Private Investment Corporation, also participated in the meeting.
Following the government-to-government TIFA Council consultations, Deputy U.S. Trade Representative Demetrios Marantis co-chaired a roundtable discussion with senior officials from the U.S. Government, COMESA and its member states, as well as representatives from the United States business community, including the Corporate Council on Africa. This discussion focused on how the United States can partner with the private sector to further advance regional integration in Africa.
Press Release from the Office of the U.S. Trade Representative, September 22, 2011Footnote 19
This Week, as part of Kazakhstan's negotiations to join the World Trade Organization (WTO), Deputy U.S. Trade Representative Demetrios Marantis and Minister of Economic Integration Affairs of the Republic of Kazakhstan Zhanar Aitzhanova signed a WTO bilateral market access agreement. The agreement signed on Wednesday will allow U.S. service providers to benefit from significantly expanded opportunities in Kazakhstan's markets once it joins the WTO. U.S. businesses will be able to continue to expand in Kazakhstan in sectors where the United States is a world leader, including energy, financial services, movies and television, express delivery, and computer services.
“Kazakhstan's desire to join the World Trade Organization demonstrates its commitment to the international trading system and to its own broad-based economic reform and trade liberalization,” said Ambassador Marantis. “Upon Kazakhstan's accession to the WTO, United States services suppliers will benefit from increased opportunities to provide a wide range of services in Kazakhstan, as well as an improved environment for doing business, which will support jobs here in America.”
“I commend Minister Aitzhanova and her team for their tireless work over the last year to complete this negotiation process,” Marantis added. “We are eager to work with Kazakhstan and other WTO members in Geneva on the remaining multilateral issues to finalize Kazakhstan's WTO accession process.”
Press Release from the Office of the U.S. Trade Representative, September 22, 2011Footnote 20
United States Trade Representative Ron Kirk today applauded Senate passage of legislation renewing the expired Generalized System of Preferences (GSP) program and also renewing key Trade Adjustment Assistance (TAA) reforms. GSP promotes economic growth in the developing world and benefits American importers and consumers by providing duty-free entry for thousands of products from developing countries. TAA provides training and support to help workers, firms, farmers and fishermen transition to alternative employment if their jobs are negatively affected by trade. TAA is an essential component of President Obama's balanced trade agenda, which aims to create jobs here at home by boosting American exports while recognizing the potential costs of trade as well.
“The Senate's action is an important step toward renewal of the Generalized System of Preferences and enactment of Trade Adjustment Assistance reforms and the pending trade agreements with South Korea, Panama, and Colombia,” said Ambassador Kirk. “Discussions continue with congressional leadership on how these bills will move through the legislative process. The trade agreements, along with Trade Adjustment Assistance, are an integral part of the President's plan to create jobs here at home. The President looks forward to their prompt passage.”
GSP saved U.S. importers nearly $682 million in duties in 2010. Most U.S. imports under GSP are used as inputs by U.S. companies to manufacture goods in the United States. According to a 2005 U.S. Chamber of Commerce study, the program supports over 80,000 American jobs associated with moving GSP imports from the docks to farmers, manufacturers and ultimately to retail shelves. GSP provides preferential duty-free entry for about 4,800 products from 129 designated beneficiary countries and territories. The program was instituted on January 1, 1976, by the Trade Act of 1974. It expired in December 2010.
The TAA legislation approved by the Senate today reflects a bipartisan agreement struck by Senate Finance Committee Chairman Max Baucus (D-Mont.) and House Ways & Means Committee Chairman Dave Camp (R-Mich.) to streamline and save costs on a renewal of key Trade Adjustment Assistance reforms. The compromise maintained the goals of a 2009 law that improved the scope and effectiveness of the program—for instance, covering Americans employed in the services sector in addition to U.S. manufacturing workers.
Press Release from the Office of the U.S. Trade Representative, September 27, 2011Footnote 21
Staff from the Office of the U.S. Trade Representative (USTR) led a U.S. delegation to London today to join other members of the International Coffee Organization (ICO) in convening the first-ever Consultative Forum on Coffee Sector Finance. Today's meeting marks a key milestone in the United States’ ongoing efforts to help reduce challenges affecting the American coffee industry, which employs American coffee retailers and roasters.
The Consultative Forum on Coffee Sector Finance was specifically designed to address challenges faced by small- and medium-sized farmers and traders in their efforts to manage risk and access credit specifically related to coffee trade. It primarily focuses on risk-management tools for green coffee price volatility and how they can be improved to better serve the needs of small- and medium-sized producers. Approximately 25 million coffee farmers, largely small- and medium-sized growers, depend on coffee for their livelihood. The United States imported nearly $7 billion worth of coffee in the last 12 months, supporting a $38 billion industry in the United States and hundreds of thousands of American workers.
“The creation of this Forum is a significant milestone for the United States and is now enhancing our ability to work closely with our trading partners, the private sector and non-governmental organizations to address issues affecting coffee production, trade, and consumption,” said United States Trade Representative Ron Kirk. “The progress made through this Forum will help maintain a stable supply of high quality coffee needed to ensure a vibrant U.S. coffee industry and support hundreds of thousands of Americans who earn their livelihood in this industry.”
Green coffee prices can fluctuate dramatically, making it difficult for growers and traders to plan accordingly. Although market-based tools such as hedging instruments are available to mitigate this risk, there are often significant barriers—such as the lack of knowledge, regulatory and institutional obstacles and financing—that make these tools largely inaccessible to small- and medium-sized coffee growers. In light of these barriers, today's meeting explored a range of potential risk management tools for small- and medium-sized growers. Among them were direct and longer-term contracts between coffee producers and roasters, the use of producer cooperatives and associations as a way to pool risk, and making market-based tools such as hedging instruments more accessible to small- and medium-sized producers.
The Forum meeting consisted of staff from USTR, the U.S. Departments of State and Agriculture, as well as representatives from the U.S. coffee industry and representatives from over 38 countries and the European Union. Participants included leading experts in coffee trade, economics and development as well as representatives of the world's leading coffee producing and consuming countries, including Brazil, Colombia, Vietnam and European Union Member States.
